A company has $100,000 to spend on the various projects listed. Using these projects only, what should this company consider its minimum attractive rate of return to be?
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- An investment of P 270,000 can be made in a project that will produce a uniform annual revenue of P 185,400 for 5 yrs and then have a salvage value of 10% of the investment. Out of pocket costs for operation and maintenance will be P 81,000 per year. Taxes and insurance will be 4% of the first cost per year. The company expects capital to earn not less than 25% before income taxes. Is this a desirable investment?Determine the FW of the following engineering project when the MARR is 15% per year. Is the project acceptable? (5.4) *A negative market value means that there is a net cost to dispose of an asset. Investment cost Expected lifeMarket (salvage) value* Annual receiptsAnnual expenses $10,000 5 years -$1,000 $8,000 $4,000You deposit $5000 into an account that will grow to $14,930 in 6 years. Your rate of return on this investment is closest to what value? (a) 18% (b) 20% (c) 22% (d) 25%
- 1.b You are faced with a decision on an investment proposal. Specifically, the estimated additional income from the investment is $125,000 per year; the investment cost is $400,000; and the first year estimated expense of $20,000 and will increase a rate of 5% per year. Assume an 8-year analysis period, no salvage value, and MARR = 15% per year. What is the ERR ( Ԑ=MARR) of this proposal? show whole solution, not in excel please(engineering economic) An investor invests in a project that requires an initial investment of Rp. 10,000,000,000 and then p. 5,000,000,000 in the following year. The project started in the second year with an operational cost of Rp. 200,000,000 in the first year and the amount increases by 10% every year until the proj lends for 10 years. Meanwhile, the income from the project for the first 5 year was uniform (A) while during the second 5 years this income increased to 1 5 times the annual revenue for the first 5 years (1.5A). The estimated residual value at the end of the project's operational life is Rp. 2,500,000,000 and investors expect the return on their investment to be 15% annually. a. Determine the minimum annual income for this project for the first 5 years and the next 5 years, so that the project does not suffer losses b. Draw the cash flows of the investment over 10 years.You are considering an open-pit mining operation. The cash flow pattern issomewhat unusual since you must invest in some mining equipment, conductoperations for two years, and then restore the sites to their original condition.You estimate the net cash flows to be as follows: N Cash flow 0 -$1,600,0001 1,500,0002 1,500,0003 -700,000 What is the approximate rate of return of this investment?(a) 25%(b)38%(c) 42%(d)62%
- The data below are estimated for a project study. i = 10% Plan A Initial Investment P 35,000 Annual Operating Cost P 6,450 Life 4 years Salvage Value none Annual Revenue 19,000 Plan B Initial Investment P 50,000 Annual Revenue P 25,000 Annual Disbursement P 13830The preferred stock for Ironhide Steel Corporation guarantees annual dividends of P50.00 per share. If an investor desires a rate of return of 10% for his investment, how much should he be willing to pay for a share of Ironhide stock? (Ans. P500.00)Engineering economy - ENGR 3322 The International Parcel Service has installed a new radio frequency identification system to help reduce the number of packages that are incorrectly delivered. The capital investment in the system is $65,000, and the projected annual savings are tabled below. The system’s market value at the EOY five is negligible, and the MARR is 18% per year. Calculate the return on investment of the project a. 35% b. 36% c. 37% d. None of the choices
- An oil company plans to purchase a piece of vacant land at the corner of two busy streets for $50,000. On properties of this type, the company installs businesses of three different types. Each has an estimated useful life of 15 years. The salvage value for each is estimated to be the $50,000 land cost. Plan Cost (in addition to land cost) Type of business Net annual income A $ 83,000 Conventional gas station $ 26,500 B $ 195,000 Add automatic car wash $ 39,750 C $ 115,000 Add quick car wash $ 31,200 if the oil company expects a 10% rate of return on its investments, which plan (if any) should be selected? Use incremental analysis, before tax.A labor saving device system save $2,000 per year for five (5) years. It can be installed at a cost of $8,000. The rate of return on this planned investment is most nearly: a.9.36% b.10% c.10.36% d.12.36%Qu a A new printer has an NPV of -$4,194 and an estimated life of 3 years. If the required rate of return is 10% per annum, the equivalent annual cash flow (EAC) is closest to: A. -$1,320 B. -$1,452 C. -$1,686 D. -$1,700 E. -$1,840. .. Full explain this question and text typing work only We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this line.